Out-of-state payday lender may get socked for $230,000

Wednesday

CHICAGO — The state’s financial-regulation agency wants to fine an Internet-based “payday” lender $234,000 for making a $300 loan to an Illinois woman.

By MIKE RAMSEY

GATEHOUSE NEWS SERVICE

CHICAGO — The state’s financial-regulation agency wants to fine an Internet-based “payday” lender $234,000 for making a $300 loan to an Illinois woman.

The Illinois Department of Financial and Professional Regulation on Wednesday filed an order against Global Payday Loan LLC demanding that the out-of-state enterprise stop issuing loans to state residents. Department spokeswoman Sue Hofer said Global Payday Loan does not have a license to do business here and violated a 2005 law under the terms of a $300 loan it made to a Chicago-area consumer last year.

That loan’s six-day repayment deadline was shorter than the mandatory minimum of 13 days, Hofer said. Also, she said, fees on the loan exceeded the limit of $15.50 per $100 that is allowed in Illinois.

Even though the consumer paid the loan back, representatives for the lender harassed her and told her she owed hundreds of dollars more, Hofer said. The agency did not identify the woman by name but quoted her in a news release as saying, “These people are sharks, and I don’t owe them any more money and don’t deserve to be harassed by them.”

The woman triggered the department’s action by filing a complaint, Hofer said.

Hofer said the state’s proposed fine of $234,000 is the largest sought against a lender since lawmakers and Gov. Rod Blagojevich approved the Payday Loan Reform Act two years ago. The new law set requirements for payday loans, which consumers typically secure with a forthcoming paycheck.

A phone message was left Wednesday with an employee of Global Payday Loan, which has offices in Jenkintown, Pa.; the company shut down its Salt Lake City operation earlier this year, according to a Utah state regulatory official who had no further information.

The firm, which does business online as Payday-Loan-Yes, can request a legal hearing to contest the Illinois order and proposed fine.

For more information about payday loan regulations or to file a complaint, go to the state Department of Financial and Professional Regulation Web site at www.idfpr.com.

Mike Ramsey can be reached at (312) 857-2323 or ghns-ramsey@sbcglobal.net.